Question

Assuming costs are represented on the vertical axis and volume of activity on the horizontal axis, which of the following costs could be represented by a line that is parallel to the horizontal axis?

a. employees who are paid $10 per hour and guaranteed a minimum weekly wage of $200
b. a consultant paid $75 per hour with a maximum fee of $1,200
c. rent on exhibit space at a convention
d. total direct material costs

Answer 1

The cost that could be represented by a line parallel to the horizontal axis is employees who are paid $10 per hour and guaranteed a minimum weekly wage of $200.

Step-by-step explanation:

A cost that could be represented by a line parallel to the horizontal axis is employees who are paid $10 per hour and guaranteed a minimum weekly wage of $200. This is because the cost remains constant regardless of the volume of activity. For example, if no hours are worked, the cost would still be $200.